Investors looking for new ways to capitalize on artificial intelligence should look at Fluence Energy , according to UBS. “FLNC is an under-appreciated beneficiary of increasing AI data center driven electricity demand as a leading supplier of utility-scale battery systems,” analyst Jon Windham said. The firm reiterated its buy rating on the energy storage stock alongside a $32 per share price target. UBS’ forecast implies nearly 38% upside from Tuesday’s close. FLNC YTD mountain Fluence Energy stock. Fluence Energy is the second-biggest battery supplier at the utility level in the U.S. behind Tesla, UBS noted. Shares are about flat for the year, lagging the S & P 500’s 10% jump. Data center demand has skyrocketed alongside the rise of AI and Nvidia. Data centers themselves are essential elements of powering AI systems, with UBS forecasting in April that demand could grow between 15% and 20% in 2024 alone. “The more data centers consume electricity, the larger the arbitrage opportunity becomes, driving more demand for energy storage systems,” the analyst said. That’s our thought process.” Windham also noted Fluence Energy can capitalize on this data center boom by offering products that help companies reach mandates for the use of 100% renewable energy — similar to other companies such as First Solar. “Just like FSLR, the demand impact for FLNC is not physically at data centers. Rather, it is created by the 100% renewable mandates,” he said. “Renewable capacity additions to support 100% renewable targets creates predictable electricity price volatility that attracts private investment in energy storage systems to arbitrage the price volatility.”
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